When Is the Best Time to Buy a Medigap Policy?
Medigap refers to different private health care insurance plans sold in Australia to supplement Medicare. If you are currently covered by Medicare, then you know Medicare Part A and Part B. These two programs cover hospitalization, medical care, pharmacy costs, and other specific benefits. Medicare Part D is the prescription drug coverage plan. This Medicare prescription drug plan provides for the filling of Medicare prescriptions and is optional.
Private health care insurance is sold through private companies that are usually managed by a board of directors with an appointed secretary. The secretary is responsible for establishing rates, rules, and payment policies for medigap plans. There are many factors considered when setting prices for these private companies. One of these factors is how the costs for medical services are calculated.
Most private insurance companies base their premiums on the projected average cost of medical service for people of a similar age and health. The difference between what they charge for a particular service and the standard medigap plans is the difference in premium cost. Standard plans typically have higher premiums because these services fall into a category of service that is usually not required by every individual. For this reason, services that are required are generally more expensive.
Other factors considered by insurance companies are open enrollment and the Medicare Advantage Plans (MAPS). The Medicare Advantage Plans can be further broken down into two primary categories: Parts A and B. Parts A covers Medicare Part A deductibles, medical supplies, and some doctor visits; and Part B covers the Medicare Part B deductible, regular Medicare plus any additional benefits that are offered through an approved physician portal.
Some Medigap policies do not cover out-of-pocket costs entirely. An example of such a policy is the High Deductible Medigap Policy. This type of policy has an extremely high deductible for Medicare benefits. However, the benefit covered is not usually any extra benefits provided through an approved practice portal. Another type of Medigap policy is the supplemental policy. With this type of coverage, the beneficiary is often required to pay a percentage of out-of-pocket costs.
Some insurance companies provide additional benefits to specific circumstances. For instance, some Medigap plans help pay out-of-pocket costs following hospital stays. This type of benefit is often only available to individuals who are in excellent health and rarely need to use hospital care. Even though this is the case, it is still relatively expensive.
One important consideration when buying a medigap policy is determining the best time to buy. Some policies are more expensive if purchased during a period of time when medical costs are at their highest. This is because the policy can pay out more if the policy holder has an accident or illness right before a large medical bill comes due. The opposite is also true; a large illness or accident will decrease the amount of money available to a policy holder. Therefore, it may be a good idea to wait until the event has passed and the policy will have a lower premium.
Understanding the types of gaps in coverage and how to fill them can help you make the most of your medigap policy. Whether you are purchasing a plan to help pay for regular doctor visits or are looking for an additional policy to help pay medical bills resulting from a debilitating illness, understanding what you need and what you can do to fill the holes in your coverage will be essential to both your peace of mind and your pocketbook. The time to address these gaps in your health care costs is now.